Latest pension plan may be the start

Published: Friday, May 3, 2013 9:20 a.m. CDT

(MCT) — We’re probably coming down with something. The symptoms include the warm sensation of feeling some degree of respect for Illinois House Speaker Michael Madigan and the lightheadedness that results from lawmakers not only addressing the state’s pathetically broken pension system, but also offering some answers.

Madigan’s 271-page piece of legislation is not a panacea. There is no single remedy that will fix the state’s broken pension system.

It would, however, be the largest step that has been taken after years of inertia.

The plan codifies some of the proposals that have been floating around without any real steam and pushes even deeper toward resolution of the state’s single-biggest problem.

It is a movement toward making some tough decisions for the future of all Illinoisans, though. It’s a shame it took it so long to get here.

As it now stands, the state owes more than $100 billion to the existing pension system. That amount increases $17 million every day.

The effects on all Illinoisans include a backlog of payments to everything from schools to city governments — $9 billion at this point — and the downgrading of Illinois’ credit score to the basement of the nation, which means it costs even more to borrow the money needed to bail out the state.

Stakeholders in the pension programs operated by the state — judges, state employees, teachers and lawmakers — are going to be displeased with some of the aspects of this plan, which received approval Wednesday from the Personnel and Pensions Committee and moves now to the full House — possibly as early as today. It still would have to be approved in the Senate. Court action is all but inevitable.

Those who receive state pensions would have limited cost-of-living increases, would have to contribute more toward their own retirements, and would receive fewer benefits.

The biggest question mark is whether the state can meet the requirement that it fully fund its obligation each year. The attempts to do so in the past have fallen significantly short.

There’s also the question of how the state will reconcile the other side of its funding nightmare and contain out-of-control spending.

That’s probably asking too much — given that it took years to truly address the pension beast — but it’s a crucial part to the entire equation.